Bloomberg News

Swiss Stocks Little Changed as U.S. Home Sales Decline

By Namitha Jagadeesh
April 22, 2013

Swiss stocks were little changed,
erasing an earlier gain, after a report showed U.S. house sales
unexpectedly fell last month, offsetting the Group of 20’s lack
of opposition to Japan’s accommodative monetary policies.

Credit Suisse Group AG (CSGN) and UBS AG followed a gauge of
European lenders higher. Cie. Financiere Richemont SA and Swatch
Group SA declined more than 1 percent as peer Hermes
International SCA said watch sales fell in the first quarter.

The benchmark Swiss Market Index (SMI) lost 0.1 percent to
7,609.1 at the close in Zurich, erasing an earlier rally of as
much as 0.8 percent. The benchmark measure decreased 1.8 percent
last week as economic reports from the U.S. to China and Germany
missed forecasts. The gauge has still surged 12 percent this
year. The broader Swiss Performance Index also decreased 0.1
percent today.

“We had a healthy correction in the last couple of weeks
and the market appears to be stabilizing now,” said Konstantin Giantiroglou, head of investment advisory at Neue Aargauer Bank
in Brugg, Switzerland. “The G-20 statement was very clever as
it did not raise again fears of an imminent currency war.”

At a meeting in Washington on April 19, the Group of 20
finance ministers failed to oppose the Bank of Japan’s plan to
buy more than 7 trillion yen ($71 billion) of bonds a month. The
central bank’s Governor Haruhiko Kuroda said he would proceed
with his campaign to end 15 years of deflation. The Bank of
Japan aims to increase inflation to 2 percent within two years.

“Winning international understanding gives me more
confidence to conduct monetary policy appropriately,” Kuroda
told reporters after the meeting. “We will continue our
qualitative and quantitative easing for the next two years.”

Italian President

In Italy, Giorgio Napolitano was re-elected as president
and he will be sworn in for a second seven-year term at 5 p.m.
in Rome. The new head of state will preside over negotiations to
form a coalition government. The elections in February failed to
produce a majority in both houses of parliament for any of the
country’s political groups.

In the U.S., sales of previously owned houses unexpectedly
declined to 4.92 million in March, data from the National
Association of Realtors showed. Economists had predicted an
increase to a 5 million annualized rate.

Meyer Burger Technology AG (MBTN), which supplies machinery to
solar-panel makers, climbed 3.7 percent to 7.37 francs after ABB
Ltd. (ABBN) agreed to buy Power-One Inc. for about $1 billion, or $6.35
a share. That’s 57 percent more than Power-One’s closing price
on April 19. The U.S. company’s inverters allow power generators
to feed solar power into electricity networks. ABB retreated 1.2
percent to 19.70 francs.

Richemont, the owner of the Cartier brand, fell 1.5 percent
to 68.15 francs. Swatch, the biggest maker of Swiss watches,
dropped 1.4 percent to 511.50 francs. Hermes said in a statement
that watch sales declined 5.3 percent as the Chinese market
slowed at the start of the year. The maker of Kelly handbags
posted its slowest revenue growth in a quarter since 2009.

To contact the reporter on this story:
Namitha Jagadeesh in London at
njagadeesh@bloomberg.net

To contact the editor responsible for this story:
Andrew Rummer at
arummer@bloomberg.net